Sunday, February 1, 2009

NEW YORK, New York -- Tonight brought the surprisingly-good-but-still-far-from-a-sealed-deal news that Republican Senators are looking to modify the stimulus bill and a re-worked plan may increase infrastructure spending in the stimulus bill by as much as $20 billion to $30 billion.

As we argued in Part 1 of this mini-series on stimulus spending, with a bill so large and unprecedented (as a Washington Post op-ed notes, it reverses a long trend of Congress shirking from any spending to increase US economic competitiveness), money should be spent wisely and in a way that improves the country's long-term economic prospects.

Infrastructure spending sounds like a good idea for reasons we already discussed. But once Congress decides to put money toward infrastructure, there of course is a wide range of choices that await. "Infrastructure" means anything from the electrical grid to telecoms to transportation infrastructure like ports, airports, roads and rail.

Since transportation infrastructure appears to be the area of stimulus infrastructure that attracts the largest amount of debate in Congress and would have the greatest effect on the economy, we'll focus on that. As the Brookings Institute notes, the sophistication and quality of a country's transport infrastructure play (and will increasingly play) an important role in its economic competitiveness -- and the US, while its postwar investments continue to pay dividends, has been coasting for the dangerously long period of 40 years and now needs $2.2 trillion in investment, according to the American Society of Civil Engineers. Since we've underinvested for so long, it's worth asking what's the best way to undertake a major capital renovation and rebuilding (or kapremont, as I would say if I was redoing my Soviet apartment) of America's infrastructure.

Most of the discussion of infrastructure spending seems to assume a) that most money should be given to "shovel-ready" projects that can be started quickly; and b) that these projects are exclusively road and bridge repairs. But while the logic of funding projects that can be quickly implemented (and quickly put people to work) is sound, the assumption that only re-tarring roads meets this description folds like me playing poker (f$%# you, poker). As the Legionnaire pointed out last week, there are dozens of major mass-transit infrastructure projects in New York City alone that are "shovel-ready," and not only do other cities have similar numbers of ready-to-go mass-transit projects, but dozens of major public transportation systems are facing budget shortfalls that will lead to service cuts.

The justification, then, of putting the vast brunt of stimulus money toward road and bridge repairs because no other "shovel-ready" projects can be found is chimerical and largely based on legislative desire to appease testy rural voters, on hopes to gain kickbacks from the mobsters who have a monopoly on road-repair industries, or on the misplaced priorities of state legislatures that oversee most infrastructure spending. But do road and bridge repairs stand on their own merits as worthy expenditures, or are other areas of transportation spending (mass transit, rail projects, ports or airports) a better investment?As the Wall Street Journal reported last week, the "shovel-ready" roads-and-bridges spending as currently construed would be used mainly for repairs to existing roads. A large part of this is that state and municipal governments are cutting back new road, bridge and other infrastructure projects because of budget shortfalls and declining revenues from gasoline taxes as that commodity's price (and the taxes that are pegged to it) falls. The WSJ writes that these cut-backs are so large that the stimulus money would only partially offset them -- meaning that it would be used to repair (i.e., put some tar on) existing roads, not create new ones.

Beyond that, given what we now know about environmental concerns, economic efficiencies and even emerging demographic patterns, building a new network of roads would be, like, so 1950s.

As a large number of Americans (fueled in part by empty-nester Baby Boomers looking both to downsize their suburban homes and reinvigorate their lives as well as by 20-somethings who grew up on Seinfeld and Friends and are opting to live in cities) move to cities from suburbs, light rail and other transit schemes that link the various anodes of economic and cultural activity of a metro area would be more in tune with sustainable development trends than building more highways. There's a fairly widespread recognition of that, including by David Brooks here.

Perhaps even more intriguingly, Scientific American writes that building roads actually hurts efficiencies not only for the empty-nesters who think moving to New York and taking the subway turns them into Lou Reed but also for ... drivers themselves. Recent studies show that removing streets actually makes traffic flows more efficient. That's because drivers, when given fewer choices, don't strive as much to maximize their own efficiency, which paradoxically allows both them and other drivers to get to their destination faster. The science behind this is based on Game Theory's Nash Equilibrium (named after Russell Crowe, before he got fat and started hitting people) and a mathematical theorem called Braess's Paradox that applies to networks.

These theorems are reflected in driving activity, as shown in studies that Scientific American cites. For anyone living in San Francisco (see video above) or Boston, you may know that the removal of 10-lane megahighways from city centers does not result in increased congestion. And cities in the US are following European patterns in converting city streets into pedestrian plazas -- and finding that gridlock is little affected.

Instead of paying for roads or even traffic lights or signs (which Scientific American notes also lead to traffic inefficiencies), Congress would be smart to invest in municipal transportation planning offices, which don't exist in many cities and states, or in innovative new open-source software that lets city planners use data collected by crowdsourcing and analysis of movement patterns to create more efficient public transit systems. Similarly, rather than repave a parking lot, doing away with on-street parking spaces altogether increases efficiencies by encouraging people to take public transit, bike, or walk. Of course, Rush Limbaugh will call a dime spent on any of this a boondoggle. But listening to him when allotting infrastructure funding is as smart as asking a Tennessee Senator for help studying for a biology exam (oh, wait, that friend of William Jennings Bryan actually went to Harvard Medical School -- note to self: Harvard Medical School must be a mess).

Other ways to put stimulus infrastructure spending to intelligent use could include

New runways and even airports in the most congested areas that cause flight delays across the US and world (Step One would be to convert the existing New York-area Stewart Airport into a commercial hub and constructing a high-speed train to allow easy access to it)

Incentives for transit-oriented development around new commuter- or light- or subway-rail hubs (as the West Coast is already doing)

Spending on grand new rail stations would create a powerful, immediate stimulus and recapture some of the glory and inspiration we once saw as desirable (and if we no longer care about creating monumental spaces, we can at least justify it economically by knowing that tourists sure like seeing them)

Simple additions of bike lanes; plazas and sidewalk space in place of traffic lanes; and dedicated bus lanes on streets would make cities more walkable, satisfying the nearly 80% of Americans who surveys say would like to see more walkable cities realized via increased public-transit investment

Upgrades to the existing freight rail network to save hundreds of billions of dollars in enery costs and transportation efficiencies, as Washington Monthly writes this month

And investments in IT to coordinate on a city level both parking for cars as well as traffic flows via stoplights and other mechanisms, electronic toll systems, congestion fees, and (on a somewhat-unrelated note) emergency-responder coordination software -- IBM is pioneering this space

"Shovel-ready" projects could be found in any of those areas, and they'd be a good first step toward the later introduction of a substantive gasoline tax, creation of a National Infrastructure Bank and coordinated investment in ports, airports and ... you get the picture.

But that doesn't mean we should forget about the interstate highway system, which is still an engineering marvel and connects population centers in the US better than any other country does. However, we do need to think about it more ambitiously than as a roadway that billions ought to be spent to repave -- after all, its primary use (as a conduit for getting goods from the shopping mall) is going the way of the dodo as malls lose their lustre. As Metropolis Magazine argues, using highway median strips for new high-speed or commuter train routes is both an efficient and natural move, and is already happening. Additionally, a nationwide smart grid that allows wind power from North Dakota or solar power from Arizona to reach the East Coast could also be built under or along the interstates. Connect the dots and you see that if highways become transit and energy corridors, perhaps the Roy Rogerses and acres of parking lots at rest stops could actually give way to densely built transit-oriented developments. It sure as hell wouldn't take much arm-twisting to convince the Legionnaire and me to move into a Dairy Queen.

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As a couple of former reporters who worked and lived in Russia, we created this blog in response to a worrying lack of expertise and critical analysis in the reporting on Russia by the English-language press. That is why we named the blog after Walter Duranty, a New York Times reporter posted in the Soviet Union during the 1930's. He wrote glowing reports about Stalin's show trials and the disastrous collectivization drives. Somehow, these fabrications won him a Pulitzer Prize. So we try to provide our own expertise and opinions about Russia to make sure another Duranty doesn't slip through the cracks. Russia can be a disheartening place, so more often than not, you will find we divert from our original purpose to take up other subjects and causes that are of interest to us - we hope they are of interest to you, too.